NMERB Guidelines Clarified

The New Mexico Educational Retirement Board (NMERB) has clarified guidance on which employees are required to make ERB contributions. Effective July 1, 2016, certain UNM employees classified as On-Call or Temporary will be eligible to earn retirement service credits with the ERB. ERB retirement service credits are earned in relation to a certain amount of time worked/paid, and in turn, contributions toward retirement service credits are withheld from the employee’s paycheck.

Please note that although the ERB guidelines are written in terms of Full Time Equivalency (FTE), UNM administers work effort in terms of Appointment Percentage. For example, an FTE of 1.0 is equivalent to an Appointment of 100%.

What is Changing?

Previously, UNM followed the ‘520 Rule’ which meant that On-Call and Temporary employees did not earn service credit or make ERB contributions until they worked over 520 hours in a fiscal year.

Starting with the July 1, 2016 paycheck, employees hired as On-Call or Temporary (including those hired through UNMTemps) who are working a Full Time Equivalency (FTE) of .26 or more per quarter, will be eligible to earn retirement credits and thus are required to make ERB contributions. Additionally, as the employer, UNM will be required to contribute the Employer Rate for each of these employees.

What Does this Mean for Employees and their Departments?

Employees who may not have seen ERB contributions in their previous checks may begin to see these deductions, if they meet the revised guideline criteria.

It is imperative that hiring officials assess “intended” work effort at the time of hire. Is the employee expected to work an FTE of .26 or more? If so, plan appropriately so the FTE reflects the intended work effort and contributions can be factored for collection beginning the first day of paid employment.

What Does this Mean for UNM as the Employer?

UNM is required to report the FTE assigned at the time of hire for certain employees to the NMERB on a monthly basis. Note: Some exclusions apply. See FAQ #5 below.

UNM must evaluate time worked for On-Call Staff and Temporary employees on a quarterly basis:

Proactively, UNM HR will run reports and contact departments if employees who were hired at .25 FTE or less are trending toward working .26 FTE or more.

If the department decides that the employee needs to work .26 FTE or more during the next quarter, HR will work with the department to increase the FTE. Payroll will then turn on the ERB deduction staring on the next pay period in which the FTE will increase. An automated email will be sent to the employee each time the ERB deduction is turned on or off.

While Human Resources (HR) will evaluate and manage the affected On-Call and Temporary Staff positions, the Office of Faculty Affairs and Services will evaluate affected Main Campus faculty positions and the HSC Faculty Contracts Office will evaluate the affected North Campus faculty positions.

What is UNM Doing in Preparation for the July 1, 2016 Change?

The Division of Human Resources (HR) is reviewing and evaluating the employee data for the position types affected.

​ERB looks at time paid during the quarter based on the reported FTE. The employee may receive a paycheck after the first day of the quarter where the time worked was in the previous quarter.

Example: A non-exempt employee receives a paycheck on July 1 for time worked June 11 through June 24. The service credits will be applied to the quarter starting July 1 and not the quarter ending June 30.

UNM has typically used a .25 FTE as a placeholder for On-Call employees. Going forward, hiring officials and supervisors will need to calculate the “true” FTE that the employee is working. In the event that the employee is actually working sporadic and unpredictable hours, then the default FTE will be .125.

​If a position is I&G funded, then ERB contributions will not affect the department’s budget. If a position is non-I&G funded, then ERB contributions will be taken from the departmental budget. To confirm budget information for Main Campus contact the Budget Office at 505-277-6465, for HSC departments, contact the HSC Budget Office.

​Yes. You would need to predetermine the employment duration and time to be worked by the employee beginning at the time of hire. The FTE will be documented as 1.0 and the employee and UNM will be required to contribute to ERB.

​Yes, unless the FTE is changed at
the beginning of the quarter where the employee worked less than a .25 FTE. If
the FTE captured in Banner is .26 or above, then the employee will make ERB
contributions. If the employee will continually work below or over their
assigned FTE, then the department will need to submit an FTE change form.